Robinhood opens NY and Seattle offices while leading US movement for real-time settlement
The trading disruption among many retail brokers caused by the r/WallStreetBets movement saw Robinhood bearing most of the shame. The venue was idolized for having the democratization of capital markets as its sole mission.
Robinhood has announced they are expanding with new office locations in New York and Seattle. The move aims to help “continue to scale to meet customer growth and build great products that meet our customers’ needs”.
The Seattle office will boast a center for infrastructure, security, and privacy to accelerate investments in those areas. The firm believes expanding the presence on both coasts ensures access to the best talent across engineering, product, operations, design, research, marketing, compliance, and other key functions.
Surabhi Gupta, VP of Engineering, said: “Our new offices will enable us to scale to meet our ambitious goals and offer more for our customers. We are delighted to join the vibrant New York and Seattle communities and look forward to welcoming more diverse talent with experience spanning finance, technology, and beyond.”
The firm will continue working remotely through August 2021 and then it will embrace a distributed workforce model, with some teams working remotely and others coming into an office full- or part-time.
The trading disruption among many retail brokers caused by the r/WallStreetBets movement saw Robinhood bearing most of the shame. The venue was idolized for having the democratization of capital markets as its sole mission.
When it started to restrict the trading of Gamestop and other meme stocks, a string of conspiracy theories made the rounds among retail investors. Robinhood was no longer the hero that took from the rich in order to give to the poor. It was the other way around.
The issues Robinhood and many other trading firms faced were due to the two-day trade settlement period in a time of extreme volatility which led clearinghouse deposit requirements to skyrocket overnight. In this scenario, investors are kept waiting for trades to clear, while clearing brokers are kept from their deposits until the settlement is finalized two days after the trade.
Instead of mitigating risk, these requirements can induce quite the opposite effect, but with new risks. The whole post-trade controversy has led many within the industry to call for real-time settlement. Robinhood’s CEO Vlad Tenev and others are calling the trading industry, Congress, regulators, and other stakeholders “to come together to deploy our intellectual capital and engineering resources to move to real-time settlement of U.S. equities”.
“Accomplishing this won’t be without its well-documented challenges, but it is the right thing to do and Robinhood is eager to drive this critical effort on behalf of all investors. Technology is the answer, not the oft-cited impediment. We believe it is important for all relevant stakeholders to convene in the near term to discuss the urgency and necessity of this issue”, Mr. Tenev added.
